Shares in Rallye, the parent company of French retailer Casino, jumped more than 7 per cent on Monday morning, after the group said it had locked in €500m in bank funding to strengthen its financial position.
Rallye said on Sunday night that it had signed a credit facility of €500m maturing June 30, 2020, with five of its core banks: BNP Paribas, Crédit Agricole CIB, Crédit Industriel et Commercial, HSBC and Natixis.
The facility was on top of Rallye’s current financing arrangements and was not secured against Casino shares, the company added.
Rallye and Casino, which are overseen by chairman and chief executive Jean-Charles Naouri, have been under pressure this year after analysts and investors have raised questions about the complexity of their debt structure and financial reporting. The new fundraising is likely to temporarily assuage some of these investor concerns.
Earlier this month credit agency S&P Global cut Casino’s ratings one notch further into junk territory, days after Casino Finance — the entity that issues the company’s bonds — told investors that it had not filed annual accounts. Casino attributed this to a “technical delay.”
Shares in Casino were up just over 2 per cent in early trading. They have lost a third of their value this year